The development of automated vehicle technology will have a profound impact on the UK’s transport system and early review the regulatory framework, closely involving all stakeholders, is essential.
A clear distinction must be made between advanced driver assistance systems (ADAS) and fully automated driving technology (or ADT).
There is a very real risk that consumers may be misinformed about the capabilities and limitations of ADAS, and may not fully understand the distinction between ADAS and ADT, in particular that with the former they need to stay fully alert at all times and will retain legal liability for any accidents that occur.
As regards compulsory insurance arrangements, our view is that the necessary statutory regime must:
- retain current compulsory insurance arrangements for conventional driving and for assisted driving that falls short of autonomous operation
- extend the scope of compulsory motor insurance to include fully automated driving and examine closely the way in which legal liability will arise and to whom (or to what) it will attach for insurance purposes and, further,
- provide for new legal rights and obligations to facilitate recoveries by motor insurers who meet claims arising from automated driving
We agree with the ABI that Government should require an extension of the existing motor insurance policy - and associated terms and legal conditions - to maintain a ‘single policy’ approach and a single point of claim for injured parties.
The envisaged extension to compulsory motor insurance would oblige motor insurers to cover, by way of first response, claims arising from automated operation of the policyholder’s vehicle. Conventional ‘driving’ would continue to be covered by the current arrangements in the Road Traffic Act 1988. Government should also create a new associated right of recovery for motor insurers who meet claims arising from automated operation so that they can subsequently pursue claims against vehicle manufacturers / those responsible for the vehicle defect at the cause of an accident.
Compulsory product liability insurance is not appropriate as a way forward and we share the ABI’s views on this point. Current product liability law and insurance practice have inherent restrictions which would not easily enable the underlying policy objectives in respect of motor accidents to be met.
A system of classification is necessary in order to identify when the extended cover for vehicles with automated functionality is needed.
The new approach proposed here must be underpinned by effective data sharing between involved parties and there must be safeguards to protect insurers from “claims surge”, either in the event of mass/systemic failures that would otherwise be brought against manufacturers or if cyber-based terrorism or organised crime affected multiple vehicles.
A full copy of the firm’s consultation response is available by emailing Natalie King.